SWOT Analysis / TOWS Matrix for Dongbu Sec (South Korea)
Based on various researches at Oak Spring University , Dongbu Sec is operating in a macro-environment that has been destablized by – increasing energy prices, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, increasing commodity prices, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings,
increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Dongbu Sec can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dongbu Sec, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dongbu Sec operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Dongbu Sec can be done for the following purposes –
1. Strategic planning of Dongbu Sec
2. Improving business portfolio management of Dongbu Sec
3. Assessing feasibility of the new initiative in South Korea
4. Making a Investment Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dongbu Sec
Strengths of Dongbu Sec | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dongbu Sec are -
Strong track record of project management in the Investment Services industry
– Dongbu Sec is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Dongbu Sec in Investment Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Dongbu Sec is one of the leading players in the Investment Services industry in South Korea. It is in a position to attract the best talent available in South Korea. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Dongbu Sec is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Dongbu Sec is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Dongbu Sec emphasize – knowledge, initiative, and innovation.
High brand equity
– Dongbu Sec has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dongbu Sec to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Dongbu Sec is present in almost all the verticals within the Investment Services industry. This has provided Dongbu Sec a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Low bargaining power of suppliers
– Suppliers of Dongbu Sec in the Financial sector have low bargaining power. Dongbu Sec has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dongbu Sec to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Dongbu Sec is one of the most innovative firm in Investment Services sector.
High switching costs
– The high switching costs that Dongbu Sec has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Successful track record of launching new products
– Dongbu Sec has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dongbu Sec has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to lead change in Investment Services
– Dongbu Sec is one of the leading players in the Investment Services industry in South Korea. Over the years it has not only transformed the business landscape in the Investment Services industry in South Korea but also across the existing markets. The ability to lead change has enabled Dongbu Sec in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Dongbu Sec
– The covid-19 pandemic has put organizational resilience at the centre of everthing Dongbu Sec does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Dongbu Sec | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Dongbu Sec are -
Employees’ less understanding of Dongbu Sec strategy
– From the outside it seems that the employees of Dongbu Sec don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dongbu Sec is slow explore the new channels of communication. These new channels of communication can help Dongbu Sec to provide better information regarding Investment Services products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of South Korea, Dongbu Sec needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Dongbu Sec supply chain. Even after few cautionary changes, Dongbu Sec is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dongbu Sec vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Investment Services industry, Dongbu Sec needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Skills based hiring in Investment Services industry
– The stress on hiring functional specialists at Dongbu Sec has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Dongbu Sec has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Investment Services industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Dongbu Sec has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Investment Services industry over the last five years. Dongbu Sec even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative at Dongbu Sec, in the dynamic environment of Investment Services industry it has struggled to respond to the nimble upstart competition. Dongbu Sec has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Dongbu Sec is dominated by functional specialists. It is not different from other players in the Investment Services industry, but Dongbu Sec needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dongbu Sec to focus more on services in the Investment Services industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Dongbu Sec has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Dongbu Sec Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Dongbu Sec are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dongbu Sec can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Dongbu Sec to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Investment Services industry, but it has also influenced the consumer preferences. Dongbu Sec can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dongbu Sec is facing challenges because of the dominance of functional experts in the organization. Dongbu Sec can utilize new technology in the field of Investment Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dongbu Sec to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Dongbu Sec to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dongbu Sec can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Dongbu Sec has opened avenues for new revenue streams for the organization in Investment Services industry. This can help Dongbu Sec to build a more holistic ecosystem for Dongbu Sec products in the Investment Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Investment Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Dongbu Sec can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Dongbu Sec can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Dongbu Sec to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dongbu Sec can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dongbu Sec can use these opportunities to build new business models that can help the communities that Dongbu Sec operates in. Secondly it can use opportunities from government spending in Investment Services sector.
Manufacturing automation
– Dongbu Sec can use the latest technology developments to improve its manufacturing and designing process in Investment Services sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Dongbu Sec can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Investment Services industry.
Learning at scale
– Online learning technologies has now opened space for Dongbu Sec to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Dongbu Sec External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Dongbu Sec are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Investment Services industry are lowering. It can presents Dongbu Sec with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Investment Services sector.
Easy access to finance
– Easy access to finance in Investment Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dongbu Sec can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Dongbu Sec demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Investment Services industry and other sectors.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Dongbu Sec business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Dongbu Sec needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Dongbu Sec can take advantage of this fund but it will also bring new competitors in the Investment Services industry.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Dongbu Sec needs to understand the core reasons impacting the Investment Services industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Dongbu Sec is facing in Investment Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dongbu Sec in Investment Services industry. The Investment Services industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Dongbu Sec in the Investment Services sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Dongbu Sec has witnessed rapid integration of technology during Covid-19 in the Investment Services industry. As one of the leading players in the industry, Dongbu Sec needs to keep up with the evolution of technology in the Investment Services sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Dongbu Sec high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dongbu Sec can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Dongbu Sec prominent markets.
Weighted SWOT Analysis of Dongbu Sec Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Dongbu Sec needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Dongbu Sec is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Dongbu Sec is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Dongbu Sec to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Dongbu Sec needs to make to build a sustainable competitive advantage.
